The Dow Jones Industrial Average was up 1.8 percent in the first minutes of trade, while the Nasdaq Composite topped 2.8 percent.

The broad-market S&P 500 gained nearly 2 percent.

In the first trading day of the new year, Wall Street joined a global equities rally celebrating the passage of a bill that avoids the "fiscal cliff" of automatic spending cuts and tax increases.

While markets were closed Tuesday for the New Year holiday, lawmakers approved a compromise bill that raises taxes on the rich and puts off automatic $109 billion federal budget cuts for two months.

If they had failed, Americans would have been hit by sweeping tax hikes, and spending cuts would have kicked in across the government, in a combined $500 billion shock that could have rocked the fragile recovery.